Parker stands by policy

Labour Party finance spokesman David Parker hit back
yesterday over claims the party's monetary policy upgrade would
hurt the low-paid.

Social agencies and Finance Minister Bill English claimed the
push to make KiwiSaver compulsory, along with allowing the
Reserve Bank to raise or lower savings contributions to help
control inflation, would hurt the lower paid.

Mr Parker said low-income New Zealanders would benefit from
Reserve Bank changes through higher wages, lower interest
rates on credit cards and loans, and rents.

Universal KiwiSaver would be introduced gradually while at
the same time, wages would increase, ensuring low-income
Kiwis were better off, he said.

''When Labour makes KiwiSaver universal, it will only apply
to those in paid work. There will be no savings requirement
for those on a benefit, so their income will not be
affected.''

The changes would also help exporters by tackling the
overvalued dollar, enabling those companies to create more
and better jobs.

However, Property Investors Federation executive officer
Andrew King warned rents could go up by 25% if a Labour
government adopted the policy of ring-fencing losses made in
the early years of rental property ownership.

A similar proposal was tried, failed and reversed in
Auckland.

During the two-year period it was tried in Australia, rents
rose by more than 25%, he said.

If Labour's policy was introduced in New Zealand with the
same result, the current median rental price would increase
by $92 per week to $462.

''We have seen so many changes over the last few years that
are harmful to providing rental property to tenants that
people are going to give up.''